800 rice mills blacklisted

With the Punjab government blacklisting nearly 800 of the 3,600 rice mills in the state, a huge stock of paddy has piled up in the grain markets.

Procurement agencies will not allot paddy to the 800 mills until the operators clear the backlog from the last season.

At least 70% of the previous work of shelling paddy to produce rice is incomplete. Of the 140-lakh-ton paddy expected to arrive in the state-managed grain markets, 25.5 lakh ton has arrived already, of which only a negligible amount has been procured and sent to the mills for shelling.

So far, things look difficult in this season of paddy procurement. "The government was left with no way out, as the mills blacklisted had failed to return a correct proportion of rice season after season," said the director of food and civil supplies, Satwant Singh Johal, justifying the tough action. "The mills will have no fresh paddy in the current kharif season."

Rules require that from a given weight of paddy, 67 to 68% should be milled as rice, but the 800 mills have not returned this figure. The milled rice goes into the Food Corporation of India (FCI) stores for further journey to the consumer states. Central agency FCI is yet to clear the backlog of procuring 13-lakh-ton rice of the previous season, and the deadline is November 30. "There can't be any respite to the blacklisted mills before November 30," said an official in the Punjab government, "even if the operators have the entire stock of paddy and rice with them."

The mills can't clear the backlog, for they don't have the entire stock. Asked if there was a hint in it of the embezzlement of rice at the mills, Johal, director of food and civil supplies, said it was too early to comment. "There are other reasons for stock shortage," he said. "It could be the quality of paddy given or the improper storage at the mills, which the government will look into."

"The government should have dealt with the situation before the onset of the procurement season," said Ajmer Singh Lakhowal, chairman of the Punjab mandi board. "However, rice miller too have overstepped their limit and government could not have continued to support them. The situation in the grain markets is bad."

Johal refused to buy the argument. "Paddy procurement will improve," he said. "Initial days are difficult generally. At least at 2,800 rice mills, the process is on to procure paddy."

The rice millers' association has asked for paddy to the units that have returned the promised 70% of the previous stock as rice. "The situation is grim," said the association's president, Tarsem Saini. "The government has declared 800 millers defaulters, and it will take some time for things to improve."